Use idle STG/USDC PoL on Fantom to Earn at Equalizer

Summary: Stargate DAO should Stake their currently idle STG/USDC PoL on Fantom into the Equalizer Gauge

By doing this, Stargate DAO starts earning EQUAL rewards for it.

No new Capital is required from treasury for this process.

Entirely self-funded via natural STG Trading Volume

Background: The proposal highlights a strategic alignment with the upcoming Fantom Sonic Mainnet launch, suggesting that this move could enhance Stargate’s Protocol-owned Liquidity’s earning potential for Stargate DAO in anticipation of increased activity and the new Fantom chain’s increase in prominence.

Stargates current Protocol-owned Liquidity (PoL) for Fantom worth $2 Million is sitting idle on Spooky Exchange, where it has not been effectively utilized due to the absence of volume-driven incentives, no allocated token emissions, and zero added on-chain visibility.

Equalizer, which operates a system similar to Velodrome et. al. is well established on Fantom chain (running in its 2nd Year on the chain), proposes this strategy to better engage this liquidity for a mutually beneficial collaboration.

Target Platform: The proposal recommends moving the PoL held on Fantom (Roughly $2M) to Equalizer, a modern, more dynamic and evolving DEX, to leverage the Starate DAO’s liquidity to earn $EQUAL emissions as reward for this LP, thanks to Equalize’s novel volume-driven fees incentivising Liquidity Provision.

Mechanism: the STG liquidity will aim to capture a share of the weekly $EQUAL emissions by appealing to the voters with volume-driven incentives (and in the future, possibly bribes). Right now, the volume being driven on this pair is not directly incentivising any emissions at all. Instead, a hefty 20% of such fees are being paid to Spooky in return for absolutely nothing!

Therefore this proposal aims to start generating returns for this $2M Protocol-owned Liquidity (PoL), while attracting more active liquidity compared to the current setup.

Incentive Structure: Volume-based incentivisation (swap fees) will be able to sustain the EQUAL emissions with no additional incentivisation. Right now, there is no direct emission pool for STG liquidity on Spookyswap, a simple switch to Equalizer would generate enough trading fees to place the STG liquidity in the top 5-10 voting incentives and therefore receive $EQUAL emissions at no cost to the DAO.

1 Week of volume on Equalizer, (based on last 6 months of weekly volume), it would be able to capture roughly $5,000+ in $EQUAL emissions for the week.

This equates to Earnings of more than $250,000 to Stargate DAO paid by Equalizer as a reward for simply staking the existing LP in the Eqaulizer gauge for STG/USDC.

Benefits: The move to Equalizer will yield higher APRs than the present rates at SpookySwap (where the LP is not earning any), coupled with additional support and visibility within a thriving DeFi community and a reputable exchange. Fantom Sonic Mainnet is expected to launch within the next few months, and it is vital that Stargate and the STG token have the visibility they deserve on-chain.

Stargate DAO could be able to add at least $250,000 annually to its treasury based on last 6 months of data, without any cost expenses. This directly translates into added intrinsic value for the STG token and all its holders.

Long-term Strategy: Future intention is to lock all $EQUAL rewards into veEQUAL to self-vote on the STG/USDC pool to further amplify Stargate PoL’s earnings. Furthermore, direct bribe allocations from the DAO to enhance these earnings even more, potentially making Fantom one of the top destinations for Stargate users, traders and long-term investors, garnished with these robust APRs for STG’s liquidity providers, including the DAO itself. This vote will give Equalizer the ability to review and strategize with the Stargate team to suggest and make adaptations based on strategy’s efficiency and submit a future proposal to the DAO if we believe that small consistent bribes could return significant amplifications to DAO’s ROIs beyond what is currently being achieved. We look towards a long-term partnership with Stargate and wish to maintain open bilateral communication with the DAO following this proposal.

Initial Steps: If this proposal passes, the following steps are to be performed.

Existing STG/USDC PoL on Fantom will be moved into the Equalizer Gauge. Further Steps: DAO may evaluate whether it wants to bribe for earning further Liquidity Incentives and higher rewards DAO may evaluate whether it wants to lock its earned EQUAL into veEQUAL to start earning even more rewards on top